Obama seeks advice from wide variety of economists

Originally published July 3, 2014 at 9:14 am

Updated July 3, 2014 at 11:16 am

For the second time in three weeks, President Barack Obama on Wednesday invited top economists to a private lunch at the White House, tapping a broad array of ideological views as he seeks to assemble an economic agenda for the remaining 30 months of his presidency.

For the second time in three weeks, President Barack Obama on Wednesday invited top economists to a private lunch at the White House, tapping a broad array of ideological views as he seeks to assemble an economic agenda for the remaining 30 months of his presidency.

Unable to get his economic policies through a divided Congress, Obama is going beyond his White House economic team in search of ideas that can translate into executive actions or ways to nudge institutions and businesses to make changes that meet his economic goals.

Some of the participants are well-known to Obama. Among Wednesday’s guests was former Federal Reserve Chairman Ben Bernanke, freed from the firewalls that separate the White House from the nation’s central bank. Others such as Princeton’s Alan Blinder, who lunched with Obama two weeks ago, and Harvard economist and former President Reagan adviser Martin Feldstein who was a guest Wednesday, have provided their advice to Obama before.

All in all, 13 economists have been to the White House since June 18, offering Obama their take on issues ranging from banking and finance to technology and education.

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The approach is not altogether new for Obama. He has been known to enjoy meals with historians and, early in his presidency, frequently sought outside counsel from economists as he prepared policies to address the financial crisis and the Great Recession. But the new sessions with economists differ in focus from the past, one senior administration official said, because Obama is tapping academics with diverse ideologies and who study a range of topics, from the impact of robotics to corporate governance to taxation.

The political views of the participants range from liberals like Princeton economist and New York Times columnist Paul Krugman, who days before his meeting with Obama described his host as “looking like a very consequential president indeed,” to conservative Kevin Hassett who has written that Obama’s efforts to stimulate a recovery “have had little visible impact on the relative performance of the U.S. economy.”

Participants, speaking on the condition of anonymity to describe the private sessions, say Obama during the 90-minute lunches asks each economist to talk about his or her work then initiates a discussion and concludes by asking for specific policy proposals. In addition to lunch with the president, several of the economists either arrived early or stayed late to meet with government economists from various agencies, including the Treasury and Commerce departments.

“I think it is good if he is trying to figure out what can be done from the White House in two and a half years,” said Anat Admati, a finance and economics professor at Stanford University who attended the June 18 session. “The White House is just a piece of the puzzle. What it can do are two things, it can appoint people subject to needing them confirmed. The second things are softer – pushing, giving cues to other people or working behind the scenes.”

Obama has been visibly frustrated by his inability to win legislative battles in Congress. Congressional Republicans note that they have passed a number of bills aimed at spurring the economy only to see them blocked in the Democratic controlled Senate. Both sides have engaged in election-year posturing, as well, pushing issues that play to their respective core voters.

In that gridlock, Obama has acted on his own, issuing executive orders and convening leaders in the private and public sector while prodding them to adopt new policies. Those efforts, however, are limited and don’t have the permanence of new law. Among the steps he has taken are ordering federal contractors to increase the minimum wage and speeding up the approval process for government construction.

“The challenge we have is not that we don’t know what to do,” Obama said in an interview with NPR’s Marketplace program that airs Thursday. “The problem is that we’ve got a Congress right now that’s been saying no to proposals that would make a difference. And so, part of our task this year and perhaps next year, is to look at what can we do administratively, or by partnering with states and local governments or by partnering with the private sector to boost wages, to improve job training so that people have better skills, to make sure that we’re matching up jobs that are out there with people who are looking for work.”

The ideas discussed in the lunches are compiled by Jason Furman, the chairman of Obama’s Council of Economic Advisers, and Jeffrey Zients, the director of the National Economic Council, who then review them to determine whether to pursue them as White House policies.

Compared to last month’s session, Wednesday’s lunch of salad, fish and dessert in the White House’s Old Family Dining Room featured more conservative voices than the session last month.

In addition to Krugman, Admati and Blinder, who served on President Bill Clinton’s Council of Economic advisers, other economists at the June 18 session were: Claudia Goldin, who has studied and written about pay equity at Harvard; Erik Brynjolfsson, who researches and teaches information technology at the Massachusetts Institute of Technology; and Roland Fryer, the founder of Harvard’s Education Innovation Laboratory.

Wednesday’s guests, in addition to Bernanke, Feldstein and Hassett, included Stanford’s Robert Hall, an early proponent of a flat income tax, Harvard’s Edward Glaeser, an expert on urban policies, and Melissa Kearney of the University of Maryland, where she specializes on poverty and economic inequality.

“The president wants to make sure that he’s consulting, you know, a wide variety of experts and people who come at this from a wide variety of perspectives to have an intellectual discussion with them about some of their ideas,” White House spokesman Josh Earnest said. “Some of this is also about identifying some broader trends in the economy and looking for ways that we can capitalize on those trends by making key investments.”